Amid concerns regarding the impact on reliability of EPA’s proposed Clean Power Plan (“CPP”), FERC scheduled a series of technical conferences to discuss the impacts of state, regional and/or federal plans for compliance with EPA’s proposed rule. Such plans could affect electric reliability, wholesale electric markets and operations, and energy infrastructure. FERC recently held the initial national conference where industry and government stakeholders strongly urged FERC to be proactive in helping to shape the CPP.
What remains unclear, however, is precisely how FERC will seek to influence a rulemaking over which the Commission lacks jurisdiction. In fact, FERC’s holding a conference on another agency’s proposed rule is highly unusual.
In a recent article on POWER magazine’s website (FERC’s Work on the Clean Power Plan), FERC Chairman Cheryl LaFleur shed some light on the Commission’s role by discussing three areas where FERC has responsibilities with respect to the CPP: infrastructure, markets, and “convening and facilitating discussions about how to balance the core values of reliability, cost, and the environment.”
Chairman LaFleur’s most interesting comments were in noting that FERC’s job “is to serve as an honest broker as work on the CPP is finalized and implemented.” After hearing in the technical conferences about how compliance with the rule might impact various entities, FERC will continue its “engagement with agencies, especially the EPA and the states, to lend our expertise, share information, and provide constructive suggestions.”
With respect to infrastructure, Chairman LaFleur notes that additions to both natural gas and electricity infrastructure will be needed. FERC has permitting authority over the additional pipeline capacity needed for the new gas-fired generators likely to be added. And FERC is responsible for planning and setting rates for interstate transmission lines likely to be needed to connect remote solar and wind generation resources to the grid.
With respect to markets, FERC will need to adapt the current wholesale electricity markets to individual states’ plans for implementing the CPP “while still delivering the benefits of competition.”
Ms. LaFleur’s chairmanship of FERC is scheduled to end in mid-April. Current FERC Commissioner Norman Bay is to become chairman on April 15, 2015.